Solicitors – Building society – Conveyancing – Claimants working for solicitors’ firm – Firm carrying out conveyancing work for building society under referral arrangement — Defendant tendering successfully for referral work – Claimants’ employment transferring to defendant – Claimants resigning on being required to relocate — Claimants claiming constructive unfair dismissal – Whether TUPE Regulations applying to professional services – Whether defendant justifying dismissal – Claims allowed in part
The claimants were employed by a firm of solicitors (L), which was based in Birkenhead. The firm had an arrangement with the Britannia Building Society whereby it handled the mortgage-related conveyancing work its customers. L had a dedicated team of 23 people who did that work, including the claimants.
The building society put the conveyancing work out to tender and the defendant was successful. The claimants took the view that their employment automatically transferred to the defendant under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).
The defendant offered the claimants work at any of its branches but the closest was 20 miles away, in Southport, so that they would be required to relocate. Since the claimants were reluctant to move and no alternative arrangement could be found, they resigned and claimed constructive unfair dismissal under the TUPE Regulations on the basis that the requirement to relocate constituted a substantial change in their working conditions to their material detriment under regulation 4(9) of TUPE.
The defendant denied any transfer of an undertaking but argued, inter alia, that if a transfer arose, any dismissals were justified since the reason for the direction that the claimants should work in Southport was an economic, technical or organisational one, entailing changes in the workforce in accordance with regulation 7(1) of TUPE.
Held: The claims were allowed in part.
The case was covered by the TUPE Regulations. Although an old-style transfer under regulation 3(1)(a) had not taken place, a service provision change had occurred within regulation 3(1)(b), L had stopped carrying activities on behalf of the building society and it had been replaced by the defendant. Immediately before the change, an organised grouping of employees had been set up whose principal purpose was to carry out the activities concerned on the society’s behalf. Although the conveyancing work might not be referred to the defendant, and the relationship was not exclusive, it had been expected that the defendant would carry out the activities in question, which gave rise to a service provision change.
In assessing whether specific employees had been transferred, it was necessary to look at the work done by each individual to establish whether their principal purpose was the particular client’s work. In the instant case, two of the claimants had passed that test and were entitled to treat their employment contracts as having been terminated unfairly.
Although the move to Southport had been clearly motivated by economic and organisational reasons, this did not entail changes in the workforce, that is, a change in the headcount or the duties of the relevant employees. Further, the defendant had not established a redundancy situation or any other legitimate reason for the dismissals. It followed that, since the dismissals were connected with the transfer, the dismissals of the relevant claimants had been unfair.
Graham Turner (solicitor) appeared for the claimants; Katie Nowell (instructed by Barnetts Solicitors, of Southport) appeared for the defendant.
Eileen O’Grady, barrister
